Cardica Calls Time-Out to Re-Think MicroCutter XCHANGE 30®

Cardica, Inc. has made the dramatic decision to pull the remainder of the latest iteration of its MicroCutter XCHANGE 30® from sale. The company wants to draw a line under the device until its next generation version is ready.

Background

Cardica designs and manufactures proprietary stapling and anastomotic devices for cardiac and laparoscopic surgical procedures. Its MicroCutter XCHANGE 30, a cartridge-based articulating surgical stapling device with a five-millimeter shaft diameter, is manufactured and cleared for use in a variety of gastrointestinal procedures and appendectomies in the United States, and is marketed for a wide range of surgical procedures in Europe.

Cardica’s Board has approved management’s recommendation to call a halt to its ongoing commercial launch of the MicroCutter XCHANGE® 30 in order to focus on improving its performance prior to having a second bite at the cherry. It has temporarily suspended the controlled commercial launch and is voluntarily withdrawing its latest iteration of the surgical stapler from the market with the intention to replace stock when the new version comes along. The company is keen to point out that it expects surgeons to continue to use the standard MicroCutter XCHANGE 30 surgical stapler, but won’t be making any more of these in the interim.

It’s quite interesting to see how Cardica is spinning the now-suspended introduction of its most recent iteration as a controlled launch, with the intention of obtaining feedback from users before a planned full introduction. It seems the feedback might have been less than fantastic, given the decision to put the launch on ice. Reading between the lines one might venture to suggest they’ve decided that to continue the launch might be a case of throwing good money after bad and could jeopardise the company’s cash position and the next generation product with it.

What the actual press release states is that “The Board and management are reexamining Cardica’s operations to focus on conserving cash by aligning spending with its focused plan going forward. After further analysis of Cardica’s operations, including timing and budget, Cardica will provide an update to stockholders.”

All of this should make Cardica’s Annual Meeting of Stockholders in December an interesting place to be.